I invest all my extra money every month. I simply do not have any cash on hand beyond paying bill and money for food. I can use my credit card (which I pay off every month) if something big happens ( like the car needing a major repair)
I can get money back from my investment banker in 2 days which i think is quick

My friends say I should have more cash on hand.

And where should I keep that emergency cash in the local bank or under the mattress?

I do have a couple hundred dollars in small bills. ($1s and $5) sitting in the cookie jar in case of power outage emergency.

My question is How much cash should I have on hand and where should I keep this emergency fund?

Sun Jul 03, 2016 7:32 am

oldguySenior Member

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We keep only $300 or $400 around the house. Like you, the extra is invested. As for using your CCs, 2-day turnaround with you broker, access to your bank etc - in a national disaster, most of those will be unavailable (and we don't know which ones). Also, your home cash may be of little use - the convenience stores won't open on "National Disaster Day' - and your neighbor may not want to sell you food from his freezer.
I guess you have to play the odds - the house insurance folks say that the likelihood of a house fire is once every 300 yrs. Most of us get the insurance because the event would be such a tragedy that we could not handle it financially. An we hope that the 300 yr fire doesn't happen on our watch. And we hope that the national financial disaster doesn't happen on our watch (such as 1929).

Sun Jul 03, 2016 6:54 pm

littleroc02usModerator

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It all depends on if you would rather charge the Emergency and then wait to pay the bill with an investment you withdrawl and wait to get in 2 days, or keep say 5k like we do so that we can simply just pay in cash with our Visa debit card and it's done. We do keep cash in the house for groceries, Target, Going out money and allowance for each of us. Basically it makes us stay on budget so that we don't overspend.

Risk comes from not knowing what you're doing. (Warren Buffet)

Tue Jul 05, 2016 2:45 pm

SemNew Poster

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how much cash should I have on hand

So littleroc02us, you think I should have $5000 on hand in a local bank or on hand in your house? . I usually have a couple of thousand in the bank but that is for just what I will need, bills , food, etc... by the end of the month that is down to a couple hundred. I invest $1,000 - $2000 a month... depending on if I have a big expense that month, like a car repair or dentist or a credit card bill to pay off.

OldGuy thinks I should have $300 in cash in the house. I only have about $200 in small bills I plan on upping that $300.00 ( in small bills) in that cookie jar.

My friends think I should have money on hand. I have wondered if there is the "big" one and power is out for days, will the bank be any more help than the stockbroker? Does anyone know?
Thanks for you help
Sem

Tue Jul 05, 2016 4:59 pm

oldguySenior Member

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quote: I have wondered if there is the "big" one and power is out for days, will the bank be any more help than the stockbroker? Does anyone know?

As a society, we are much more dependent on 'power' than we were 50 or 100 yrs ago. Back then, the banks and brokers used lanterns/candles. Now they are dependent on electricity/computers - but they all have backup generators - the lights and computers can run for days. And when the"big one" hits your area, the backup power keeps you connected to interstate banks, international banks, the CC grid, etc.

But there was an interim when our society was power dependent AND w/o backup power. A few decades ago I was in a store when the power went out - the young folks at the registers were unable to function, couldn't accept cash, couldn't make change. An older woman set up a cash box at her window and started taking purchases, making change, etc.

Tue Jul 05, 2016 5:56 pm

littleroc02usModerator

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Imo, having $5000 in a savings account for emergencies that you don't touch for anything else is the way to go. It will cover major car repairs, air conditioner, water heater, etc. it's purpose isn't to make money. Plus if Putting aside 5k for emergencies worries you that your ROI sucks, then you probably don't have a lot of wealth accumulated. For me it's a low percentage. I you are just starting out wth investments then $1000 is enough.

Risk comes from not knowing what you're doing. (Warren Buffet)

Tue Jul 05, 2016 6:05 pm

littleroc02usModerator

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Haven't you noticed that when the power goes out at a store or business credit cards are useless and cash is still accepted. I wonder how soon cash would be useless after a big one hit?

Risk comes from not knowing what you're doing. (Warren Buffet)

Tue Jul 05, 2016 6:08 pm

rajatNew Member

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Invest small to get better

Mon Jul 18, 2016 1:27 am

ArtsMoneyTalkNew Member

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quote:
My question is How much cash should I have on hand and where should I keep this emergency fund?

i usually try to keep 200 in my wallet and 3-6 months worth of expenses in a separate checking account that's there for emergencies only

Amount equal to 6 month of your average spendings is a good saving. Everything below 3 month is risky. Better start saving at least 10% of your income.

Sat Sep 03, 2016 9:22 pm

marketsignalsFull Member

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So it's Legal and from where u invest and get Earned from these Fluctuating If you buy on face value and than you can Sell on more value you will get a chance to earn. Do you heard for BURSA KLSE Malaysia our company works for them?

Depends where you live. If you live in tornado territory, you probably want an emergency kit in a firesafe box in the basement, containing:
- $500 to $1000
- crank operated flashlight
- crank operated radio
- one of the above should have a usb port as well, to charge your phone
- first aid kit
- duct tape
- superglue
- scissors

That's the store-and-forget box. A more useful box that does require semi-frequent access might also contain your passport, batteries, and battery operated equipment. You might even want to have spare car keys in that box.

Then there's the financial disaster scenario. If currency is devalued, having some gold and silver in the box will help.

Getting back to cash amounts, I also keep $5000 in a brick-and-mortar bank near my house, and another $10,000 in my online bank in a money market account. The brick-and-mortar money is for quick access scenarios, since it would take me a week or so to withdraw the 10 grand.

Tue Sep 27, 2016 3:31 pm

christcorpPreferred Member

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This is obviously a 2 part question. 1) how much should you have in savings, not investments. 2) how much of this savings should you keep at home and immediately available.

As already said, 3-6 months of your income is smart. This covers emergencies, getting laid off or fired from your job, helps you get back on your feet. So, if you make $50,000 a year, you should have about $15,000-$25,000 in savings. Obviously most can't do this overnight. But within a couple years, you can. And as your income goes up, so should the savings.

How much should be at home immediately available. I personally believe, around 20%. About $3,000-$5,000. Of course, a fire proof safe and not in a cookie jar or hidden where it can burn up.

And in line with another post I commented on, once you can go past the 3-6 months of income in savings, I recommend another few months of savings in silver and gold. This is for other reasons such as inflation, opportunities to pay down debt, opportunities to purchase items at discount, or shtf. But this is for another discussion. But for this thread, 3-6 months of income in savings, and 20% of that savings in cash at home.